Alcion holds first close on largest fund to date

The Boston-based private equity real estate firm has held an initial close on $269 million in equity commitments for Fund III, which is targeting $600 million.

Alcion Ventures has held a first close on its latest commingled offering, Alcion Real Estate Partners Fund III.

The Boston-based private equity real estate firm brought in $269 million for the fund, which is targeting $600 million, according to documents from the Securities and Exchange Commission. Probitas Funds Group is serving as the placement agent for the fund, according to the filing.

Alcion will target for Fund III distressed equity and debt opportunities within select major metropolitan areas in the US and Canada coming as a result of market corrections and a lack of available liquidity. The firm will focus on such markets as Boston, Chicago, Los Angeles, Washington DC, San Francisco and Toronto.

Investors in the fund already include the Arizona Public Safety Personnel Retirement System, which made a commitment of up to $30 million to the vehicle at its January 15 investment committee meeting. The pension also made an investment in Alcion’s previous fund, Alcion Real Estate Fund II.

Fund II closed above target on approximately $500 million in August 2011 above its initial target of $400 million with investments from a mix of pension funds, endowments, foundations, family offices and high net worth individuals from the US, Canada and Europe. Investors included the Arizona State Retirement System, Harvard Management Company and the Silicon Valley Community Foundation.

The vehicle, which launched in 2008, was raised for the same strategy that Alcion will pursue with Fund III.